Best Unsecured Credit Cards for Bad Credit in 2022

A low credit score, or any score below 579, can put a damper on almost any financial plan, including if you want to get a credit card. Like it or not, most credit card issuers require good or excellent credit to qualify for their best deals.

There are credit cards for fair credit, or FICO scores from 580 to 669, but these offers are rare. Secured credit cards are a popular option for people with bad credit, but these cards require a security deposit up front.

If that doesn’t sound appealing, there are unsecured credit cards for bad credit to consider, all of which allow you to borrow money without a security deposit.

The Best Unsecured Credit Cards for Bad Credit in 2022

If you’re hoping for an unsecured credit card, but have bad credit, read on to find out which cards we recommend.

Visa® Petal® 1 “no annual fee” credit card: the best no annual fee

The Visa Petal 1 “No Annual Fee” credit card allows you to build credit with no security deposit and no annual fee required. Your credit limit can range from $300 to $5,000, and you may qualify for a credit limit increase when you make payments on time for at least six months. Even better, the Visa Petal 1 “no annual fee” credit card factors in alternative data like banking history for approvals, so past credit mistakes don’t carry as much weight.

Advantages:

  • No annual fees and no foreign transaction fees
  • Helps build credit by reporting to all three credit bureaus
  • Get pre-qualified without a thorough investigation of your credit file

The inconvenients:

  • High interest rate potential (variable APRs range from 19.99% to 29.49%)
  • Credit limit can be as low as $300
  • Rewards limited to special offers with specific retailers

Read our Petal 1 “No Annual Fee” Visa Credit Card Review for more details.

Credit One Bank® Platinum Visa® for Rebuilding Credit: Best for Earning Money

The Credit One Bank Platinum Visa for Rebuilding Credit is another popular unsecured credit card available to consumers with imperfect credit. This card allows you to earn 1% in cash rewards on gas, groceries, your cell phone bill, Internet, cable and satellite TV services. You also have access to a free credit score, which can help you track your progress towards better credit.

Don’t let the cashback distract you from a significant inconvenience, though. The card comes with an annual fee of $99 ($75 in the first year). You’ll need to spend $9,900 in the 1% cash back categories to earn $99, so it probably doesn’t make sense to choose this card for cash back over a card with no annual fee.

Advantages:

  • 1% cash back on popular spending categories
  • Free credit score
  • Get pre-qualified without a thorough investigation of your credit file

The inconvenients:

  • High variable APR of 23.99%
  • Credit limit can be as low as $300
  • Charges an annual fee of $75 the first year, then $99 per year

Read our Credit One Bank Platinum Visa to Rebuild Credit Review for more details.

Capital One Platinum Credit Card: Best for Fair Credit

You might put yourself in the “bad credit” category because you know your score isn’t ideal, but there’s a big difference between having bad credit and fair credit in terms of the cards you qualify for. The Capital One Platinum credit card is available to consumers with fair credit, which includes FICO scores from 580 to 669.

Although this card does not offer any rewards, you can be prequalified without further investigation of your credit report, and you can qualify for a higher credit limit in as little as six months. Best of all, there’s no annual fee.

Advantages:

  • Get pre-qualified online without a thorough investigation of your credit report
  • Potential to increase credit limit in as little as six months
  • No annual fees and no foreign transaction fees

The inconvenients:

  • High variable APR of 26.99%
  • No rewards for spending

Read our Capital One Platinum review for more details.

Discover it® Student Cash Back: Best for No Credit History

If you’re a student with no credit history, Discover it Student Cash Back could help you build credit. This card offers 5% back in rewards on up to $1,500 spent in quarterly bonus categories (then 1% back) as well as 1% back on everything you buy. Discover will even double any rewards you’ve earned after the first year, and there’s no annual fee.

Advantages:

  • No credit score required to apply
  • Generous rewards for spending
  • No annual fees and no foreign transaction fees
  • Year One Cashback Match

The inconvenients:

  • Potential for a high interest rate after the introductory offer ends (variable APRs range from 12.99% to 21.99%)
  • Created specifically for students

Read our Discover it® Student Cash Back review for more details.

What to Look for in an Unsecured Credit Card

Unsecured credit cards for bad credit are not all the same, so you’ll want to compare the cards and all their details to find the right fit.

What you want:

  • Automatic review for a line of credit increase. Unsecured cards for bad credit are likely to start you off with a low credit limit. However, many give you the option of a higher credit limit in as little as six months, which could boost your credit score in addition to increasing your purchasing power.
  • An application process that looks at factors other than your credit score. Some cards for bad credit, including the Visa Petal 1 “no annual fee” card, look at things like your bank history to see if they can approve you. This can be useful if your credit score is very low or you have no credit score.
  • Reporting to major credit bureaus. You want to make sure the cards you’re considering are reporting balances and payments to all three credit bureaus: Equifax, Experian, and TransUnion. Ultimately, this report is what will help you build your credit over time.
  • Awards. Keep an eye out for cards that offer rewards, but only when it makes sense. For example, you should never sacrifice a better interest rate for rewards if you know you will have a balance.

What you don’t want:

  • Expensive annual fees. You should try to choose a new credit card that doesn’t charge an annual fee if you can. If you decide to pay an annual fee, make sure you’re getting something you want in return (and have the math work out in your favor). For example, a card that doesn’t earn rewards and doesn’t charge an annual fee won’t cost you anything unless you have a balance. On the other hand, until you spend $9,900 on a card that earns 1% cash back and charges a $99 annual fee, you will lose money.
  • Hidden fees. In addition to looking for cards that don’t charge high annual fees, watch out for hidden fees such as application fees or monthly account fees. If you’re traveling overseas, you should also find a card that doesn’t charge foreign transaction fees.
  • High interest rates. Look for a card with a reasonable interest rate if you plan to carry a balance occasionally.

How to fix your credit with a credit card

Repairing your credit with a credit card can take some time, but the steps are the same for everyone. The following tips can help you achieve the best results in the least amount of time.

  • Always pay your bill on time. The most important factor that makes up your FICO score is your payment history, so you should strive to pay all your bills early or on time each month. Where on-time payments can be a boon to your score, late payments can have disastrous effects.
  • Keep debt levels to a minimum. The second most important factor that makes up your FICO score is how much you owe relative to your credit limits. Try to keep your balance below 30% of your available credit. For best results, pay it off in full each month.
  • Ask for a higher credit limit as soon as possible. If you have a balance, getting a higher credit limit may lower your default usage rate. If you qualify for an increased line of credit at any time, you should take one. However, be sure to avoid racking up more debt or you won’t be better off.

When a secured credit card might make more sense

If your credit score is low and you can’t get approved for an unsecured credit card, don’t be afraid to sign up for a secured credit card. While putting down a cash deposit might not sound ideal, secured credit cards give you the ability to build credit when other cards don’t. Additionally, many secured credit cards offer rewards with no annual fee, and you can switch to an unsecured credit card once your score improves.

Finally, remember that your security deposit is not lost. When you close or upgrade a secured credit card in good standing, you get your full security deposit back.

The bottom line

The best unsecured credit cards for bad credit might not be exactly what you want, but they let you borrow money and some even offer rewards. More importantly, cards in this niche give you the ability to build credit so you can get a better credit card later.

The cards we highlight on this page are worth checking out, but be sure to compare other credit cards for bad credit and fair credit before deciding.

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